Regulator to investigate £150bn credit card market amid fears for 'survival borrowers'

The FCA is already investigating payday lenders and could impose a cap on borrowing rates from 2015.

Mr Wheatley said: “We know it’s not uncommon for the most ‘at-risk’ households to hold multiple cards and revolve balances month by month. There are some obvious questions and challenges here for regulators and industry: why are card issuers providing the means, in some cases, for the most indebted consumers to escalate their way into further debt?”

StepChange, a debt charity, said about 10pc of the people who asked it for advice had five or more credit cards and an average £27,000 of debt.

Mr Wheatley said there was no predetermined outcome for the review. “There is, however, a duty of care to consumers, and I think it’s important for there to be clarification of whether competition is working in their interests,” he said.

David Kenmir, head of financial services conduct and culture at PwC, the accountancy firm, said: "This review could help consumers exhibiting signs of financial distress so their situations are not worsened, and it could cause a fundamental rethink in how people regularly paying minimum payments are identified and then supported by credit card firms."

The UK Cards Association, a trade body for the sector, had no immediate comment.

Gross spending on credit cards was £150bn last year and outstanding balances amounted to £57bn, the FCA said.

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